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In 1990, when pagers were considered high-tech, digital color
printing was at the leading edge, and Greg Carafello, a former
Canon employee, was capitalizing on it. That year he opened
AbraCadabra Digital Printing in New York City.

"Our store just took off," he says. "It was all tech-based, so
people would come in with files for us to print. Ad agencies were
printing dummies they could never print cheaply before."

Carafello eventually pulled in $4 million per year with 39
employees at four branches in New Jersey and Manhattan, including
a flagship on the 18th floor of the World Trade Center's south
tower.

Carafello was at his flagship on Sept. 11; he escaped the
building after the second plane hit. Losing the main branch of
his business was bad enough, but Carafello also lost his best
friend in the building collapse. He moved operations to a store
in New Jersey, but with the loss of major WTC clients, the
company's revenue slumped more than 75 percent. In 2004,
Carafello decided to sell.

But not before he had gambled on a backup plan. A year earlier,
he purchased the master franchise
rights for
Cartridge World, a new Australia-based concept that refilled
old printer cartridges. In less than a decade as a master
franchisee, Carafello has opened 38 stores in New Jersey, 11 in
Maryland and Virginia and eight in upstate New York. He also has
plans for 30 new stores in Manhattan. Here's how franchising
rebuilt his career.

You're an experienced entrepreneur. Why go into
franchising?
I was always anti-franchise. But you get tired when you're an
entrepreneur on your own. You have lots of people working for
you, but at the end of the night, it was still me sitting at the
kitchen table, looking over brochures, making sure they were
printed correctly. Back in '92 and '94, I tried selling recycled
toner cartridges, sending them to a company in Nashua, N.H. But I
couldn't get consistent quality. Then we had a bad batch of
cartridges and almost lost our printing customers [because] they
were so upset. Cartridge World had a proven product.

What is a master franchisee?
As master franchisee, I am essentially the franchisor. I can sign
a deal and terminate a deal. It's all me; I hold all
responsibility. I don't own the stores, but I'm tied into the
royalties. I make less money if my franchisees make less money.

In my old business, everybody was tied into the profits of the
store. It was like it was their own business. Drivers, clerks,
managers--everybody worked liked they owned it. With franchising,
it's the same model.

Any special considerations in conquering
Manhattan?
Cartridge World's board of directors approved my "Manhattan
model," where the retail space is only 300 to 400 square feet,
versus the usual 1,500. We usually have a second office and
warehouse somewhere cheaper. What I determined was that to have a
successful smaller site, it needs to be located in a vertical
space with at least 30 floors of businesses above that could use
the service. We're also targeting hospitals, post offices and
Staples stores. There are 18 Staples in Manhattan; they're a
fierce competitor that does good demographic research. I figure,
why reinvent the wheel? We want to go in right next to them.

Are printer manufacturers trying to shut you
down?
The industry itself is creating roadblocks to make it harder to
use recycled cartridges. It could be a download for new firmware,
or a button you have to push before you can use other people's
products. Buying a printer is like buying a car and having the
manufacturer tell you that you can buy only Luke Oil gas. But
printer companies do $80 billion in business per year, and
Cartridge World does less than $1 billion. We're not even on
their radar screens yet. Once customers find us, though, they
love us, and they keep coming back.